The Conference Board(R) Japan Business Cycle Indicators(SM) Japan Leading
Economic Indicators and Related Composite Indexes for April 2008
NEW YORK, June 5 /PRNewswire/ -- The Conference Board reports today that
the leading index for Japan decreased 0.2 percent and the coincident index
increased 0.3 percent in April.
-- The leading index declined slightly in April, after remaining unchanged
during the past two months. Large declines in the index of overtime
worked, the six-month growth rate of labor productivity, and new orders
for machinery and construction more than offset positive contributions
from financial components of the index. With the small decline in
April, the leading index continued to fall, at about a -1.1 percent
rate between October 2007 to April 2008 (a -2.1 percent annual rate),
well above the -4.8 percent annual rate which prevailed during the
previous six months. Moreover, the weaknesses among the leading
indicators continued to be more widespread than the strengths.
-- The coincident index increased in April, but there were large downward
revisions to this index of current economic conditions in the last four
months as actual data for manufacturing sales for the first quarter of
2008 became available. Despite fairly balanced strengths and
weaknesses among the coincident components, it continued to fall at
about a -0.7 percent rate from October 2007 to April 2008 (about a -1.5
percent annual rate), well below the 1.3 percent annual rate for the
period between April 2007 and October 2007.
-- Although the rate of decline in the leading index has moderated
slightly in recent months, it has declined for eight of the last twelve
months and it is now 5.2 percent below its recent highest level in
December 2006. At the same time, real GDP growth picked up to a 3.3
percent annual rate in the first quarter of 2008, up from the (revised)
1.9 percent average annual rate in the second half of 2007 and the 1.0
percent rate in the first half of the year. Despite stabilizing
somewhat in recent months, the weaknesses in the composite indexes
suggest that economic growth is likely to be slow in the near term.
LEADING INDICATORS. Four of the ten components that make up the leading
index increased in April. The positive contributors to the index -- in order
from the largest positive contributor to the smallest -- include stock prices,
dwelling units started, real money supply, and interest rate spread. The
negative contributors -- in order from the largest negative contributor to the
smallest -- include the index of overtime worked, the six-month growth rate of
labor productivity, the new orders for machinery and construction component*,
the Tankan business conditions survey, the (inverted) business failures*, and
real operating profits*.
With the decrease of 0.2 percent in April, the leading index now stands at
84 (1990=100). Based on revised data, this index remained unchanged in both
March and February. During the six-month span through April, the index
decreased 1.1 percent, and three of the ten components advanced (diffusion
index, six-month span equals 30.0 percent).
COINCIDENT INDICATORS. Three of the four components that make up the
coincident index increased in April. The positive contributors to the index --
in order from the largest positive contributor to the smallest -- include the
retail, wholesale, and manufacturing sales* component, number of employed
persons, and wage and salary income*. Industrial production declined in
April.
With the increase of 0.3 percent in April, the coincident index now stands
at 108.3 (1990=100). Based on revised data, this index decreased 0.8 percent
in March and remained unchanged in February. During the six-month span
through April, the index decreased -0.7 percent, and two of the four
components advanced (diffusion index, six-month span equals 50.0 percent).
Summary Table of Composite Indexes
2007 6-month
Feb Mar Apr Oct to Apr
Leading index 84.2 p 84.2 p 84.0 p
Percent Change 0.0 p 0.0 p -0.2 p -1.1 p
Diffusion 40.0 20.0 35.0 30.0
Coincident Index 108.9 r 108.0 p 108.3 p
Percent Change 0.0 r -0.8 p 0.3 p -0.7 p
Diffusion 50.0 25.0 75.0 50.0
n.a. Not available p Preliminary r Revised
Indexes equal 100 in 1990
Source: The Conference Board All Rights Reserved
Website: http://www.conference-board.org/economics/bci/
The next release of the Japan Composite Indexes is scheduled for
Tuesday, July 8, 2008 at 9:00 P.M. (ET)
In Japan -- July 9, 2008 at 10:00 A.M. (JST)
SOURCE The Conference Board
Professional Contacts at The Conference Board, Indicator Program,
+1-212-339-0330, indicators@conference-board.org, Frank Tortorici,
+1-212-339-0231, or Carol Courter, +1-212-339-0232
